Moteks Pty Ltd v Matthews Pastoral Co Pty Limited

Moteks Pty Ltd (the appellant) appealed to the New South Wales Court of Appeal against a decision of the Supreme Court of New South Wales. The dispute concerned the interpretation and enforceability of a contract for the sale of land, specifically whether a condition precedent had been satisfied.

The primary legal issue before the Court of Appeal was whether the condition precedent, requiring the purchaser to obtain finance on terms satisfactory to the purchaser, had been fulfilled or waived. This involved determining the objective standard for "satisfactory" finance and the implications of the purchaser's conduct in relation to the finance condition.

The Court of Appeal held that the condition precedent was not satisfied. It reasoned that the purchaser had not acted with sufficient diligence to obtain finance on terms that could reasonably be considered satisfactory. The purchaser's conduct, including a failure to pursue a particular loan offer diligently and a subsequent attempt to terminate the contract, indicated that they had not genuinely sought to satisfy the condition. The Court applied the principle that a party seeking to rely on a condition precedent must act in good faith and take reasonable steps to fulfil it.

Consequently, the Court of Appeal dismissed the appeal, upholding the Supreme Court's finding that the contract had not been validly terminated by the purchaser.